The Democratic nominee for Texas comptroller says the Republican nominee, state Sen. Glenn Hegar of Katy, made a taxing promise.
Mike Collier of Houston said in a March 18, 2014, email blast, "Glenn Hegar promised to eliminate the property tax," a step Collier said would trigger the state’s "most outrageous tax increase" ever.
Hegar’s alternative to the property tax, Collier wrote, would require sales taxes "to be at least 20 percent -- and possibly as high as 25 percent" to pay for local needs such as "schools and county roads ... water and sewage treatment" and more.
For this article, we’re setting aside what happens should property taxes go away.
But did Hegar promise to kill property taxes?
Broadly, no single official including the comptroller can abolish property taxes, which are levied by cities, counties, school districts and other taxing units. Abolition would take legislation passed into law and maybe a voter-adopted amendment to the Texas Constitution.
Republicans including Debra Medina and Raul Torres, among comptroller candidates defeated by Hegar in the 2014 primary, have voiced support for getting rid of property taxes; Medina pitched replacing property taxes with expanded sales taxes as far back as her 2010 gubernatorial bid.
In fact, the Texas GOP party platform, adopted at the party’s 2012 convention, says, "We encourage abolishing property taxes (and) shifting the tax burden to a consumption-based tax," as Dale Craymer, president of the business-oriented Texas Taxpayers and Research Association, noted in an email exchange with us.
As we embarked on this fact check, we noticed Hegar’s campaign website doesn’t discuss property taxes. We also asked for an interview with Hegar about any promise to wipe out property taxes; campaign manager David White told us by email that Hegar wasn’t available on the couple days we inquired. White also said he was unaware of Hegar directly promising to eliminate property taxes.
White emailed us an excerpt from Hegar’s Dec. 31, 2013, response to a questionnaire from the Dallas Morning News in which Hegar referred to "an antiquated system of property tax collection. While I prefer a shift to more of a consumption-based tax system, (I) know that we are many years away from being able to implement such."
Collier spokesman Jason Stanford, asked for evidence of such a Hegar promise, emailed us Hegar’s Jan. 20, 2014, answers to a Collin County Conservatives questionnaire and a Feb. 5, 2014, Killeen Daily Herald/Temple Daily Telegram news story on GOP comptroller candidates’ Feb. 4, 2014, debate in Salado.
Neither showed Hegar promising to abolish property taxes, but both described his support for gradually reaching that goal. "I support a shift from the property tax toward a consumption tax system. I believe a consumption tax is the fairest, most transparent tax system," Hegar wrote in the questionnaire. (Consumption taxes are those levied when a person spends money on a product or service.) According to the news story on the Salado debate, Hegar, Medina and Torres all "said they were in favor of completely phasing out property taxes."
Stanford also pointed us to a video clip the Collier campaign posted online, which it also began using in a video ad that debuted April 1, that comes from the Jan. 6, 2014, meeting of a Longview tea party group.
Collier’s website links to a longer video recording of the event, posted to YouTube by the Longview group. Here’s our transcript of two property-tax answers from Hegar, bolding the words Collier included in his video ad:
Audience member: I would just like to know your thoughts on ending the property tax and replacing it with something along the lines of a consumption tax or something, so we can finally own our property?
Hegar: That -- well, you took the words with your last statement: so you can own your property. Because you really don’t. The government owns it. The question is how much do you pay rent. I tell you, I don’t like the property tax, never have. I think we should replace it. The best thing to replace it with is a consumption-type tax, sales tax per se. I was up -- I was talking to somebody the other day about it, and the question is, is what would that number be. Oh, I know what it was: I got it on a questionnaire, one of the tea party groups. And they said, ‘Well, what steps do you take?’ and I said, ‘Steps? You just do it.’
That’s the only way you get there. You know, I know the votes have not been in the Legislature a few sessions ago in order to try to get rid of it. But the fact is as comptroller, I have said numerous times -- or, running as -- that is the only fair way. Because the question is, who pays? Everybody pays. And you actually, when you buy that loaf of bread or whatever be it, you pay the tax and guess what? You get to walk away with the bread. You don’t have to bring the last four loaves back. And that’s kind of what it is with your property. …
Different audience member: … There’s a lot of people my age that aren’t going to own property any time soon, so what kind of -- what do you have to say to them? That they have to pay, we have to pay higher taxes on the things we consume? But we don’t own property.
Hegar: Well to me, it’s still a fairness, I mean you’re, you’re here in Texas and so the fact is is you pay sales tax today. You pay a portion of the tax. But you may not pay all of it, and so should we favor one set of folks because they may not own property versus other people? No, the fact is, is the landowners, if you look at local property, as in a school district, they’re paying half of it. Well, why shouldn’t it be distributed among everybody and not just based only on the landowners? And you treat all landowners the same; you don’t pick and choose winners and losers. (Applause.) I mean I -- I just think -- and the reason I said earlier is, you know, business, people, you fill in, Texans should succeed on their own merits and you shouldn’t be picking winners and losers, and that winners and losers, if that means that younger people because they don’t own their home, then that puts a greater burden on them, and compare the current system, maybe it does, but it’s fair. That’d be my personal opinion.
Stanford told us that by using the phrase "Just do it," Hegar "may not have said the words ‘I promise,’ but he explained how he would" eliminate property taxes.
Another tea party video the Collier campaign is publicizing shows Hegar both describing obstacles and spelling out the role he would take. Collier says on his website the video shows Hegar proposing a sales tax rate of up to 18.5 percent to cover cuts in property taxes.
In the full interview, posted online Dec. 31, 2013, by the Montgomery County Tea Party, Hegar said that in replacing the property tax with a sales tax, "the hardest question to answer for the Legislature that puts it into place, No. 1, is obviously getting the votes to do it." After that, "then the biggest question is, is that one (tax) that you broaden the base, as in what is taxable for consumption, or is it the rate? And that’s where the numbers get really hard," he said. "Maybe you’ve heard wild percentages."
Starting with the existing state sales tax of 6.25 percent plus local sales tax of up to 2 percent, Hegar said, "does that go up 3 percent, 18 percent? Up to 18.5 percent, some numbers have been out. But the question is how wide and how broad is that. And that’s where the Legislature has seemed to get caught up."
Asked how the comptroller could influence legislators, Hegar told the tea-party group, "I think the comptroller’s role should use more of what’s called a dynamic fiscal note," a type of report that he said can be used to show the opportunities presented by a tax cut, such as eliminating property taxes, rather than only presenting its negative effect on state revenues. The note is "something that I would definitely utilize," he said.
Collier said, "Glenn Hegar promised to eliminate the property tax."
Hegar has said that as comptroller, he would "definitely" use a dynamic fiscal note to encourage the policy change, but he also has spoken about the difficulties of reaching an approach that wins legislative favor. We rate Collier’s statement as False.